Is Enhanced CPC Good or Bad For Your Shopping Campaigns?

While we tend to err on the side of caution when it comes to automation strategies and techniques – we have seen some pretty significant success with the latest version of Google’s Enhanced CPC feature – specifically for our Shopping campaigns.

Introduction of Google’s Enhanced CPC

Enhanced CPC (also known as ECPC) looks for ad auctions that are more likely to lead to conversions, and then raises your max CPC bid (after applying any bid adjustments you’ve set) to compete harder for those clicks.

According to Google, if a click seems less likely to convert, AdWords will lower your bid. ECPC will try to keep your average CPC below the max CPC you set (including bid adjustments), but may exceed your max CPC for short periods of time.

For example, if you sell baseball caps on your site, and you’ve set your max CPC for US$1, and you have ECPC bidding turned on.

If the AdWords system sees an auction that looks likely to lead someone to buy caps on your site, it might set your bid to US$1.35 for that auction.

If ECPC sees another auction that looks unlikely to lead to a sale, it might lower your bid to US$0.25 for that auction.

Although ECPC as a bidding strategy within Adwords has been available for a couple years now, Google recently came out with an updated version for Shopping in 2017 and later rolled out an update for Search / Display.

Pro-tip: The original version of ECPC gave Google the authority to increase your bids up to 30% but with the new update there is essentially no capped amount – although Google will try to stay in close range to your original set bid.

A/B Testing ECPC on Google Shopping Campaigns:

“So far, we’ve seen the most success with ECPC on the Shopping side,” Ben Whitrock, Sr. Retail Search Manager at CPC Strategy said.

Late last year, Whitrock ran a series of A/B tests on Google’s ECPC Shopping feature.

Below is his 60 day comparison (Google Shopping campaigns only) for a laundry parts supplier:

7/22/17 – 9/21/2017 (Google Shopping campaigns WITHOUT eCPC)

9/22/17 – 11/22/17 (Google Shopping campaigns WITH eCPC)

As seen in the example above, we saw significantly better ROAS 1087% with ECPC turned on vs. 842% without ECPC.

“I A/B tested ECPC on 70% of my clients and every single retailer (with the exception of one) saw an improvement in performance with the ECPC feature turned on,” Whitrock said.

“ECPC is well on it’s way to becoming a best practice within our department, at least on the Shopping side.”

But according to Whitrock, ECPC on the Search / Display is still “a bit hazy”.

“We haven’t determined if giving Google more flexibility is actually beneficial to our ROAS specific clients on that end just yet, but we will continue testing.”

“My recommendation (if you want to test ECPC) is to start with your Shopping campaigns.”

How to enable Enhanced CPC

Your campaign must have conversion tracking enabled in order to use ECPC.

Also, keep in mind that ECPC works slightly differently for Shopping campaigns than it does on Search and Display. For more information on setup, visit Google AdWords.

Why Advertisers Can’t Solely Rely On Enhanced CPC:

According to Keith McGonigle, one of the first Retail Search Managers to introduce ECPC to our bidding tactics at CPC Strategy, advertisers shouldn’t rely solely on Google’s latest feature to improve account performance.

“It’s important to keep in mind that what is going to make the biggest difference in your campaign performance is strategically optimizing your bids through sophisticated campaign management. ECPC is a nice additional layer, but you can’t expect to turn on Google’s ECPC feature and it will completely fix your account.”

“You should only think of ECPC as an additional layer to an already optimized bidding strategy.”

Tips to Optimize Your Google Shopping Campaigns in 2018

In 2018, there will be more digitally consumed ads than ever before and marketers will have to enhance their creativity and strategic advertising approach to stay ahead of the curve.

If you’ve been paying attention, you know that big box retailers (Target, Walmart, Amazon) are flooding Google Shopping Product Listing Ads (PLAs) and competition on the SERP is increasing.

“Now more than ever, it’s important to get strategic about the way you run your Google Shopping campaigns.”

“Your campaign architecture should maximize your Google Shopping return, and you should shift budget to the most impactful keywords for your business.”

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About the AuthorTara graduated from the University of New Hampshire with a B.S. in Journalism / Business. Her passion for creative publishing and quality reporting landed her work opportunities at several companies in Massachusetts, New York and California. She is a leading voice behind CPC Strategy’s Blog. See all posts by this author here.

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